2nd Quarter Financial Results for FYE June, 21 February 17, 21 (Securities code : 7747 2nd section of the Tokyo Stock Exchange, 2nd section of the Nagoya Stock Exchange, JASDAQ)
All Rights Reserved.Copyright ASAHI INTECC CO.,LTD. 1 1. Summary of Financial i Results of FYE 6/21 Q2 2. Earnings estimate of FYE 6/21
All Rights Reserved.Copyright ASAHI INTECC CO.,LTD. 2 Change of Segment Division - 1 We are changing segment division i i as follows in FYE 6/21 Previous Medical Division Therapeutic Catheter Systems Snare, etc. Diagnostic Catheter Systems New Segments Medical Brand Division Therapeutic Catheter Systems Diagnostic Catheter Systems Medical Device Division Medical OEM Division OEM Supplied Products Medical Components Snare, etc. OEM Supplied Products Industrial Device Division Device Division Industrial Components (Wire components, finished goods) Medical Components Industrial Components (Wire components, finished goods) Snare: High-Frequency Polyp removal endovascular device
All Rights Reserved.Copyright ASAHI INTECC CO.,LTD. 3 Change of Segment Division - 2 Rationale for Change In the past, the Industrial Device division developed components not only for industrial use but also for the medical field. Medical components currently earmarked for the Medical Device division will be nearly completely taken up by the Industrial Device division, and transferred to the Medical Device division as intra-company sales. Medical component sales are expected to continue growing; therefore, the Industrial Device division is expected to perform more development and manufacture for medical components than for industrial components. Given these conditions, the change in segment division was made to be more certain to grasp profits from the components business. Special notes to the documentation below Comparisons to the same period previous year are made after division adjustments to the previous year s combined accounting.
All Rights Reserved.Copyright ASAHI INTECC CO.,LTD. 4 FYE 6/21 Q2 YTD Main Points (Consolidated) Net sales made a firm improvement to 7,49 Million Yen (21.2% increase over last year) Increased Revenue : Medical areas Decreased Revenue : Industrial Devices General economic instability had a negative impact on industrial device sales, while medical devices, especially Asahi brand devices, showed large growth and positive developments. Medical Device operating income significantly increased due to reduced production costs and increased efficiency. Positives Negatives Operating income were 1,647 Million yen (13% increase over last year) (Operating income Margin up 8.9 points over last year) Thai baht and other low exchange rates helped lower production costs Prices of often used stainless steel and platinum led to lower raw materials costs Large PTCA-GW order after Abbott negotiations allowed for continuation of planned operation at production facilities Efforts to reduce fixed costs and sales related costs Costs related to establishment of ASAHI INTECC HANOI CO.,LTD Reduction in stock valuation related to reassessment Ordinary income is 1,561 Million Yen (3.5% over last year) Non-operating expenses down 85 Million Yen due to high yen exchange rate (458 Million earmarked, same as last year) Net income (Q2 YTD) is 1,6 Million Yen (Last year showed net loss of 286 million yen) Extraordinary loss due to securities reevaluation earmarked for 44 million yen (last year earmarked 458 million yen) Extraordinary loss due to loss from prior period adjustments t earmarked for 76 million yen
All Rights Reserved.Copyright ASAHI INTECC CO.,LTD. 5 Highlight (Consolidated) FYE 6/29 Q2 YTD FYE 6/21 Q2 YTD Amount (mil.yen) Ratio (%) Initial Plan 29/8/11 Revision Plan 21/2/3 Amount (mil.yen) Ratio (%) Year on year Changes Changes (mil.yen) (%) Compared to initial plan Change (%) Net sales 6,111 1. 7,215 7,48 7,49 1. +1,297 +21.2 +2.7 Gross profit 3,269 53.5 3,928-4,178 56.4 +99 +27.8 +6.4 Operating income Ordinary income Net income (Q2 YTD) E P S (JPY) 811 13.3 1,54 1,646 1,647 22.2 +835 +13. +56.2 389 6.4 1,16 1,567 1,561 21.1 +1,171 +3.5 +53.6 286-626 1,13 1,6 13.6 +1,292 - +6.7 18.5-39.5 63.95 63.48 - - - -
All Rights Reserved.Copyright ASAHI INTECC CO.,LTD. 6 Net Sales by Segment Division FYE 6/29 Q2 YTD FYE 6/21 Q2 YTD Amount Ratio Amount Ratio Changes Changes (mil.yen) (%) (mil.yen) (%) (mil.yen) (%) Medical Brand Division 3,63 59. 5,123 69.1 +1,519 +42.2 Medical OEM Division 882 14.4 899 12.1 +16 +1.9 Device Division 1,625 26.6 1,386 18.7 238 14.7 Total amount 6,111 1. 7,49 1. +1,297 +21.2 ( Reference ) Medical Field 4,958 81.1 6,458 87.2 +1,499 +3.2 Industrial Field 1,153 18.9 95 12.8 22 17.6
All Rights Reserved.Copyright ASAHI INTECC CO.,LTD. 7 Operating income by Segment Division FYE 6/29 Q2 YTD FYE 6/21 Q2 YTD Amount Ratio Amount Ratio Changes Changes (mil.yen) (%) (mil.yen) (%) (mil.yen) (%) Medical Brand Division 971 65.7 1,828 78.9 +857 +88.2 Medical OEM Division 174 11.8 28 9. +33 +19.4 Device Division 332 22.5 279 12. 53 16. Subtotal 1,478 1. 2,316 1. +838 +56.7 Erasing & HQ 667-669 - - - Total amount 811-1,647 - +835 +13.
All Rights Reserved.Copyright ASAHI INTECC CO.,LTD. 8 Earnings performance by Segment Division (Million yen) Net Sales (Million yen) Operating income 2,5 8, 6, 4, 2, 6,111 1,153 1,198198 6,111 1,625 882 3,76 3,63 7,49 1,647 1,386 899 5,123 Device Division Medical OEM Division Medical Brand Division Erasing & HQ 2, 1,5 1, 5-5 811 2 277 811 332 174 1,1 971 279 28 1,828-667 -667-669 8/12 8/12 9/12 (Previous) ( New Segments ) ( New Segments ) -1, 8/12 8/12 9/12 (Previous) ( New Segments ) ( New Segments ) 9/6 FY Q2 YTD 1/6FY Q2 YTD 9/6 FY Q2 YTD 1/6FY Q2 YTD
All Rights Reserved.Copyright ASAHI INTECC CO.,LTD. 9 (Million yen) 2, 1,5 Attribution analysis of operating income-1 (Exchange rate fluctuations included) M 694 Positive effect of 1, increase sales 811 5 215 Positive effect of increase gross profit 19 Positive effect of decrease sales costs Negative effect Positive effect of increase of decrease 64 R&D costs Administration costs 58 1647 1,647 3 Negative effect of increase Labor costs High yen had positive impact on SGA (+31) Thai baht and other low exchange rates helped lower production costs Prices of often used stainless steel and platinum led to lower raw materials costs Large PTCA-GW order after Abbott negotiations allowed for continuation of planned operation at production facilities Efforts to reduce fixed costs and sales related costs Costs related to establishment of ASAHI INTECC HANOI CO.,LTD Reduction in stock valuation related to reassessment High yen/low dollar had negative impact on sales ( 311) PTCA GW large increase ( +1,181) 8/6FY Q2 YTD Operating income 8/6FY Q2 YTD : US $ 11. THB 2.93 9/6FY Q2 YTD : US $ 91.46 THB 2.72 9/6FY Q2 YTD Operating income
All Rights Reserved.Copyright ASAHI INTECC CO.,LTD. 1 (Million yen) 2, 1,5 1, 811 Attribution analysis of operating income-2 (Exchange rate fluctuations excluded) M 172 86 Positive effect of increase sales 251 14 Positive effect of decrease sales costs Positive effect of increase gross profit 79 Negative effect of increase Labor costs Negative effect of increase R&D costs 58 19 Positive effect of decrease Administration costs 1,647 5 Currency exchange influence 8/6FY Q2 YTD: US $ 11. THB 2.93 9/6FY Q2 YTD : US $ 91.46 THB 2.72 8/6FYQ2 YTD High yen/low dollar had negative impact on overall sales, but coupled with increase in overall sales led to large increase in operating income. 9/6FYQ2 YTD Operating income Operating income
All Rights Reserved.Copyright ASAHI INTECC CO.,LTD. 11 (Million yen) 5, Per Segment by Medical Brand Division Sales 5,123 Foreign and Domestic Progressing as Planned Sales 5,123 Million Yen(42.2% increase over last year) Operating income 1,828 Million yen (88.2% increase) Therapeutic Catheter Systems 4,866 Million yen (increase of 1,538 Million yen 46.2%) 4, Domestic : Success in a wide range of medical areas, focused 3,63 on vascular PTCA GW large increase (p.13 ) 3, PTCA balloon catheter introduction driving sales Peripheral (Dialysis) PTA Balloon catheter sales increases 3,327 4,866 Newly developed neurovascular devices progressing well Foreign : Growth in Abbott and non-abbott sales 2, Therapeutic Catheter System USA, EU, Asia, all world sales show increase in PTCAGW 1, sales; China with more than expected (p. 12, 15) CTO penetration catheter Corsair launch leading to increased sales in USA and EU New sales due to Peripheral GW contract t and launch with USA company Diagnostic Catheter System 275 256 8/6FY Q2 YTD 9/6FY Q2 YTD Diagnostic Catheter System 256million yen (down 19 million yen from last year, 6.9%) Severe price competition, plan to shrink in foreign markets
All Rights Reserved.Copyright ASAHI INTECC CO.,LTD. 12 Per Segment by Medical OEM Division (Million yen) 1, Sales 8 Concentrate on launching gproducts in new medical segments Sales 889 Million yen (1.9% increase over last year) Operating income 28 Million yen (19.4% increase over last year) 6 4 2 882 899 OEM Products OEM Products 889 Million yen (16 million yen, 1.9% increase) OEM Products to domestic manufacturers leveling out Peripheral and IVR guide wires progressing Endovascular related devices decreasing Foreign markets (centering on US) progressing well Peripheral, Neurovascular GW sales up 8/6FY Q2 YTD 9/6FY Q2 YTD
All Rights Reserved.Copyright ASAHI INTECC CO.,LTD. 13 Per Segment by Device Division (Million yen) Sales 1,8 1,625 1,6 1,4 1,386 1,2 1, 1,153 95 8 Industrial Components 6 4 2 472 436 Medical Components 8/6FY Q2 YTD 9/6FY Q2 YTD Medical and Industrial Component R&D, Production, and Sales Poor economic conditions continue to have negative effect on the component business Sales 1,386 Million yen (Down 14.7% from last year) Operating income 279 Million yen (Down 16% from last year) Industrial Components 95 Million yen (Down 22 Million yen, 17.6% from last year) Poor economic conditions led to severely decreased orders on all but one product Foreign markets automotive rope, squid fishing rope increased Foreign and domestic markets both saw decrease in office equipment components Focus on shift to high value-added products, review pricing policies Medical Components 436 Million yen (Down 36 Million yen, 7.7% from last year) Foreign medical component business flat Domestic endovascular related product orders decreased
All Rights Reserved.Copyright ASAHI INTECC CO.,LTD. 14 Foreign Sales Division (Million yen) 8, 7 7, 6, Foreign sales progression 7,49 6,86 6,111 Foreign sales up to 1,61 Million yen (46.5% increase from last year) Weak dollar and decreases in industrial device orders offset by gains in medical component and branded medical device businesses Abbott 28 agreed volumes reaffirmed in negotiations end of Oct. led to large increases in orders from Nov. Medical Brand performing well, especially in Asian markets (Million yen) 4, 5, Sales by segment division Combined Net sales 4, 3, 2, 1, 2561 2,561 (42.1%) 3,344 3,344 3, 597 Device Division 2,561 74 Medical OEM 2,282 Division 2,282 719 (45.1%) 2, 632 2 6 (37.4%) 1, 2,672 Medical Brand 1,821 1,589 Division Foreign sales 7/6FY Q2 YTD 8/6FY Q2 YTD 9/6FY Q2 YTD 7/6FY Q2 YTD 8/6FY Q2 YTD 9/6FY Q2 YTD
All Rights Reserved.Copyright ASAHI INTECC CO.,LTD. 15 P/L (Consolidated) FYE 6/29 Q2 YTD Amount ( mil.yen ) Ratio (%) Amount ( mil.yen ) Ratio (%) FYE 6/21 Q2 YTD Changes (mil.yen) The main comparison factors Net Sales 6,111 1. 7,49 1. +1,297 Increase of Medical field Cost of Sales 2,841 46.5 3,23 43.6 +388 Decrease of production costs and raw materials costs Gross profit 3,269 53.5 4,178 56.4 +99 Increase efficiency SGA 2,457 4.2 2,531 34.2 +73 Increase of labor costs and R&D costs Operating income 811 13.3 1,647 22.2 +835 Non-operating income 88 1.4 42.6 46 Decrease of insurance return 4 Non-operating operating expense 51 8.3 128 1.7 381 Foreign exchange loss 372 Ordinary income 389 6.4 1,561 21.1 +1,171 Extraordinary Reversal of allowance for doubtful gain. 8.1 +8 Extraordinary accounts +8 Loss on devaluation of investments securities 414 loss 538 8.8 12 1.6 417 Loss from prior period adjustments t +76 Net income 286-1,6 13.6 +1,292 Decline in value of Inventory assets 66
All Rights Reserved.Copyright ASAHI INTECC CO.,LTD. 16 B/S (Consolidated) FYE 6/29 FYE 6/21 Q2 YTD Amount Ratio Amount Ratio Changes ( mil.yen ) (%) ( mil.yen ) (%) (mil.yen) Current assets 11,117 53.8 11,376 54.4 +258 Fixed assets 9,537 46.2 9,539 45.6 +1 The main comparison factors Cash equivalent +565 Accounts receivable +8 Inventory assets 496 Fixed assets +2 Investments securities 3 Total assets 2,655 1. 2,915 1. +26 Current liabilities 4,624 22.4 4,646 22.2 +21 Short-term loans +195 Income taxes payable Fixed liabilities 3,872 18.7 3,331 15.9 541 Long-term loans 613 Total liabilities 8,497 41.11 7,977 38.1 519 Total net assets 12,158 58.9 12,938 61.9 +78 Retained earnings +879 Translation adjustment 119 69 Total liabilities & net assets 2,655 1. 2,915 1. +26
All Rights Reserved.Copyright ASAHI INTECC CO.,LTD. 17 C/F (Consolidated) (Million yen) 6, Payment for purchase of fixed assets 425 486 Effects of exchange rate changes on cash and cash equivalents 26 1,584 55 26 4, 4511 4,511 3,945 Proceeds and repayment of borrowings 376 Cash dividends paid 126 2, Income before taxes +1,449 Depreciation +41 Increase of accounts receivable 135 Decrease of Inventory assets +457 9/6FY Operating Investing activities Financing Other 9/12FY activities activities Cash and cash equivalents Cash and cash equivalents
All Rights Reserved.Copyright ASAHI INTECC CO.,LTD. 18 1. Summary of Financial i Results of FYE 6/21 Q2 2. Earnings estimate of FYE 6/21
All Rights Reserved.Copyright ASAHI INTECC CO.,LTD. 19 Vision for FYE 6/21 (Consolidated) - 1 Because H1 Net Sales were better than expected, the forecast for the fiscal year was revised upwards. ( Net sales: revised upward 1.3%, Operating income : 26.5%, Ordinary income: 25.5%, Net income: 27.4%) Net Sales expected to progress strongly with 14,981 Million yen (up 17.8% from last year) Increasing revenue segment : Medical Devices, Decreasing revenue segment : Industrial Devices Industrial devices likely to continue in difficult circumstances due to the instability of the current economic climate; however, Medical devices advancing strongly, especially Asahi brand products both in foreign and domestic markets. Sales to Abbott and non-abbott both increasing Large income increase expected due to accrual of advance fees, effects from increased production of medical devices Operation income of 2,821 Million yen (58.3% increase over last year) (Expected increase of operating income margin of 4.8 points) While endeavoring to lower costs, also planning to invest advance fees for future growth (R&D costs, personnel and education costs for strengthening sales and marketing functions) Ordinary income of 2,79 Million yen ( 88.4% increase over last year) Net income this term of 1,84 Million yen ( 34.6% increase over last year) Assumed exchange rate 1/6 FY H2 : US $ 95. yen THB 3. yen 1/6 FY : US $ 93.23 yen THB 2.86 yen Effect of exchange rate on operating income (estimate) US $ (+1 yen influence) : approx. 59 million yen increase THB (+.1 yen influence) : approx. 78 million yen decrease
All Rights Reserved.Copyright ASAHI INTECC CO.,LTD. 2 Vision for FYE 6/21 (Consolidated) - 2 Forecast assumption : H2 Proceeds as expected Sales Medical Brand Division continues progressing as in H1, will beat original forecast Due to continuing poor economic worldwide conditions and the shift to higher value-added products, sales for industrial components may come in under forecast. Foreign medical components and domestic OEM sales may also come in under forecast. Planned revision in April 21 for insurance reimbursement lowering may result in as much as 1% decrease to plan Income Continuing efforts to lower costs are forecast to result in slight lowering of fixed costs and SGA Large new OEM production preparation and new bringing new facility online may mean temporary production slowdowns From next FY new large products will be produced from ASAHI INTECC HANOI CO.,LTD. Moving new production to ASAHI INTECC THAILAND CO.,LTD. Inventory assets reduction (Direct shipping, stock reevaluation for appropriate stocking levels)
All Rights Reserved.Copyright ASAHI INTECC CO.,LTD. 21 Earnings estimate of FYE 6/21 FYE 6/29 FYE 6/21 (plan) Amount ( mil.yen ) Ratio (%) Initial Plan 29/8/11 Amount (mil.yen) Ratio (%) Year on year Changes Changes (mil.yen) (%) Compared to initial plan Changes (%) Net sales 12,718 1. 14,789 14,981 1. +2,263 +17.8 +1.3 Gross profit 6,888 54.2 8,84 8,289 55.3 +1,4 +2.3 +2.5 Operating income Ordinary income 1,782 14. 2,229 2,821 18.8 +1,38 +58.3 +26.5 1,438 11.3 2,158 2,79 18.1 +1,271 +88.4 +25.5 Net income 445 3.5 1,416 1,84 12. +1,358 +34.6 +27.4 E P S (JPY) 28.13-89.35 113.8 - -
All Rights Reserved.Copyright ASAHI INTECC CO.,LTD. 22 Earnings estimate by Segment Division (Million yen) Net Sales 16, 14,981 14, 12,718 2,794 12, 1,981 1,889 1, 2,356 8, 6, 1,298 4, 8,379 2, Device Division Medical OEM Division Medical Brand Division (Million yen) 5, 4, 3, 2, 1, Operating income 1,782 178 516 2,484 2,821 48 379 3,477 Erasing & HQ -1,397 1397-1,444 1444-1, -2, 2 9/6 FY 1/6 FY 9/6 FY 1/6 FY (Plan) (Plan) Old Segment New Segment Old Segment New Segment
All Rights Reserved.Copyright ASAHI INTECC CO.,LTD. 23 Earnings estimate by New Segment Division (Million yen) Net Sales (Million yen) Operating income 16, 5, 14,981 2,821 14, Device 2,794 4, 48 Division 12,718 379 12, 1,782 Medical * 2,886 * 1,889 3, Brand 414 333 * 1, Division * 1,752 2, 3,477 8, 2,431 * 1, 6, Medical 1,298 Brand 4, 8,79 Division * Erasing & HQ -1,397-1,444 2, -1, 9/6 FY 1/6 FY * New Segments (Plan) -2, 9/6 FY 1/6 FY * New Segments
All Rights Reserved.Copyright ASAHI INTECC CO.,LTD. 24 (Million yen) 3,5 3, 2,5 2, 1,782 Attribution analysis of operating income for Earnings estimate of FYE 6/21 M 174 49 1,226 Positive effect 194 Positive effect of increase sales Positive effect of increase gross profit of decrease sales costs Negative effect of increase Labor costs Exchange rate fluctuations ( 343) Negative effect Negative effect of increase of increase R&D costs Administration costs 147 69 While endeavoring to lower costs, also planning to invest advance fees for future growth Increases of R&D cost personnel and education fees for strengthening sales and marketing functions 2,821 1,5 Inventory assets reduction etc High yen had positive impact +362 1, 5 Sales to Abbott increasing +1,86 Sales to non-abbott increasing especially Asahi brand products High yen had negative impact on sales 365 9/6FY (Actual) Operating income Assumed exchange rate 9/6 FY (Actual) : US $ 98.49 yen THB 2.83 yen 1/6 FY (Plan) : US $ 93.23 yen THB 2.86 yen 1/6FY (Plan) Operating income
All Rights Reserved.Copyright ASAHI INTECC CO.,LTD. 25 Equipment Installation Actual and Plan (Million yen) 3,5 3, Capital cost 2,866 Depriciation 2,5 2,392 2, 2,1 1,5 1,373 1, 973 76 787 885 889 1,124 5 335 449 5/6 6/6 7/6 8/6 9/6 1/6(plan)
All Rights Reserved.Copyright ASAHI INTECC CO.,LTD. 26 Notice about these data The plan, forecast and strategy about our future business performance are estimated by the data available and they might include risk and uncertainty. Please be aware that the actual performance might differ vastly due to critical factor of every kind as a result. Where to contact about these data and IR Asahi Intecc Co., Ltd. Corporate strategic office TEL 52-768-1211 URL http://www. asahi-intecc.co.jp/